More than 100 commercial real estate industry hopefuls gathered in Newark recently for the Rutgers Center for Real Estate’s annual career seminar. — All photos courtesy of Jeffrey Vock for Real Estate NJ
By Joshua Burd
For all of the complexities of commercial real estate, good advice can come in simple forms.
Just ask Mike DeMarco, who preaches the importance of learning two things a day.
“If you keep your mind incredibly sharp, incredibly driven toward actually going someplace, you will eventually get there,” said DeMarco, CEO of Mack-Cali Realty Corp. “It’s a matter of when, not if.”
He later added: “The one thing I firmly believe in is knowledge — the more you have, the better off you are. It’s very simple: Learn more today, and you’ll be able to handle tomorrow’s problems with ease.”
DeMarco was sharing the mantra with a crowd that may well have included the next generation of commercial real estate professionals in the state. That group was on hand recently at the Rutgers Business School in Newark, where the university’s Center for Real Estate hosted its second annual career night for industry hopefuls.
More than 100 gathered to hear DeMarco and other New Jersey real estate leaders discuss their careers and offer words of wisdom for anyone thinking about getting into the field. The panel was moderated by Paul V. Profeta, the benefactor of the Rutgers Center for Real Estate and the president of Paul V. Profeta & Associates in West Orange, and also featured Marjorie Perry, CEO and president of MZM Construction; Christopher Paladino, president of New Brunswick Development Corp., or Devco; and Gretchen Wilcox, founder and CEO of G.S. Wilcox & Co.
The discussion offered a look the different types of positions and specialties within commercial real estate, along with details about earning potential and tips about how to be successful. Wilcox, who leads the nation’s only female-owned commercial mortgage banking firm, encouraged the attendees to be involved industry events and charitable endeavors.
Developing those types of connections was key to obtaining the financial backing needed to start her Morristown-based business in 1994.
“Joining industry associations and networking through the industry associations is extremely, extremely important for your career,” said Wilcox, whose firm is based in Morristown. “So if you’re going to take something home, I would take that.”
Paladino, who leads a nonprofit specializing in urban revitalization, echoed the idea that knowledge is power in commercial real estate. That’s important when it comes to developing in places such as New Brunswick and Atlantic City, as Devco is currently doing, with complexities such as trying to finance the projects and coordinating the types of public-private partnerships that are needed.
That can mean an environment that amounts to “controlled chaos,” but Paladino said the upside is that the developments typically “have a public policy goal.” That comes with the reward of doing projects such as a community grocery store and wellness center, Rutgers’ first new academic building in New Brunswick in more than 50 years or a new headquarters office for a badly needed corporate anchor in Atlantic City.
“You try to find some time on weekends to actually read and think about things that you don’t get to do in the chaos of the day,” Paladino said. “You are always working, but it’s because you love doing it.”
The panel at the March 28 event included professionals from different segments of commercial real estate. Profeta, a value-add investor for more than 40 years, took students through the highs and lows of a process that includes trying to acquire property, making improvements and knowing the right time to sell.
“One thing you’ve got to be sure of: Don’t buy a distressed property in a distressed market, because if you fix up a distressed property in a distressed market, you’ve still got a distressed property,” Profeta said. “So you want to find C minus properties in healthy markets. And what I try to do is elevate them up to B or B plus.
“Never try to elevate them to the top of the market because then there’s no place to go,” he added. “(Then) when you sell it, the guy or the woman who is buying it doesn’t have an objective to shoot for, because they want to be value-add also.”
As for other tips in value-add investing, Profeta said landscaping is a “very, very inexpensive way to spruce something up. It has a tremendous pop from the street and you get a big bang for your buck.
But for all of tricks of the trade that will help generate success, there is also risk.
“If you’re going to do this well, make sure you buy it right,” he added. “If you overreach on the buy, you spend the whole process trying to catch up and sometimes you never do.”
Perry, a contractor and developer, said one way to avoid the pitfalls of starting out in commercial real estate is to partner with someone who understands the inner workings of a deal. It’s why she often mentors others on “running the numbers” to reduce the stress that can come with taking on debt service and assembling the capital stack.
“Everybody on this panel has had a loss,” Perry said. “There’s no direct route to success, but I think what I heard today that all of us have a love for what we do and a high level of risk taking, but understanding the game they’re playing by learning and learning the two things every day.”
Among the other nuances that the panelists discussed, Paladino offered one other simple piece of advice.
“New Jersey is a really small place, whether you’re involved in politics or real estate,” he said. “Be nice to each other. … It’s a small world and at some point you may need each other or have the opportunity to help each other.”
Editor’s note: Paul Profeta, founder and president of Paul V. Profeta & Associates, is also the publisher of Real Estate NJ.